Icadam Technologies Sdn Bhd and Others v CAD-IT Consultants (Asia) Pte Ltd and Others

• Jurisdiction: Singapore
• Judge: Kan Ting Chiu J
• Judgment Date: 21 July 2005
• Neutral Citation: [2005] SGHC 130
• Court: High Court (Singapore)
• Published date: 01 August 2005
• Year: 2005
• Plaintiff Counsel: Daniel Koh and Charissa Soh (Rajah and Tann)
• Defendant Counsel: Benedict Tan (Goodwins Law Corporation),Randhir Ram Chandra and Thomas Tan (Haridass Ho and Partners)
• Subject Matter: Damages,Aggravation,Tort,Whether decision to award aggravated damages must be made by person assessing damages,Whether aggravated damages should be awarded,Evidence,Witnesses,Witnesses' credibility,Corroboration,Weight given to evidence by non-neutral persons,Whether second defendant had spoken the words complained of,Defamation,Defamatory statements,Second defendant making defamatory remarks regarding plaintiffs,Natural and ordinary meaning of words,Whether words complained of defamatory,Vicarious liability,Defences,Whether knowledge, approval and consent constituting elements of vicarious liability,Words and Phrases,Definition,"Calculated to disparage the plaintiff in any office, profession, calling, trade or business",Section 5 Defamation Act (Cap 75, 1985 Rev Ed)
• Citation: [2005] SGHC 130

21 July 2005

Kan Ting Chiu J:

The parties

1 Mr Wong Chee Tieng or C T Wong is the second plaintiff in this action. He is the director of research and development of the first plaintiff, Icadam Technologies Sdn Bhd. In 1995, he set up a company known as CT Design Software House Sdn Bhd (“CT Design”). CT Design developed and marketed software for use in the metal stamping industry known as “V6 Software”.

2 In 1999, the second plaintiff and CT Design entered into a joint venture with the first defendant CAD-IT Consultants (Asia) Pte Ltd, another company which is now named V6 Technologies (Asia) Pte Ltd (“V6”), and two individuals. Pursuant to the joint venture, CT Design assigned its rights in the V6 Software to V6, and the second plaintiff became a shareholder and director of V6 and also the first defendant’s general manager of V6 Software development.

3 Disputes arose between the joint venture parties which led to a settlement whereby the second plaintiff sold his shares in V6 and ceased to be involved with V6 and the first defendant.

4 After parting ways, the second plaintiff set up the first plaintiff which also engaged in developing software for the metal stamping industry, and it developed software known as “iCADAM Software”.

5 As the first plaintiff and the first defendant were in the same field of business, they had common target clients, one of which was Amtek Engineering Limited (“Amtek”).

6 The action arose from a visit to Amtek by two employees of the first defendant, namely Mr Alvin Tan Chin Yew and Mr S Elamurugan (“Elamurugan”) on 9 March 2004 to promote V6 Software. The former was a market development manager and also the second defendant in this action. The latter was a software engineer. The plaintiffs claimed that the defendants defamed them during that visit.

The words complained of

7 The words complained of were not set out in the Statement of Claim filed by the plaintiffs. Both the defendants wanted the plaintiffs to give particulars of the words. The words provided in the Further and Better Particulars to the Statement of Claim were:

CT Wong has no any rights to develop software that is related to the Metal Stamping Industry;

The software developed by CT Wong might have infringed the Intellectual Property Right of CAD-IT/V6’s technology software, and will be subjected to future legal pursue and consequences; and

Any future user/customer, including prospective user/customer like Amtek, who uses the software developed by CT Wong will have to pay the royalty fees to CAD-IT for the usage of CAD-IT/V6’s technology.

8 The plaintiffs claimed that those words, by their natural and ordinary meaning meant and were understood to mean that:

(a) the plaintiffs, by developing and commercially exploiting their software for use in the metal stamping industry, had acted in breach of their legal obligations and would be subject to civil and/or criminal liability for such breach;

(b) the plaintiffs, by developing and commercially exploiting their software for use in the metal stamping industry, had infringed or are likely to have infringed the intellectual property rights of the first defendant and/or V6 such that legal proceedings would be commenced against the plaintiffs and they are thereby subject to civil and/or criminal liability for such breach under the Copyright Act (Cap 63, 1999 Rev Ed) or any other relevant laws;

(c) in relation to the promotion of the iCADAM Software the plaintiffs have been dishonest and/or dishonourable in their dealings with Amtek; and/or

(d) the plaintiffs were dishonest and/or dishonourable in their trade or office.

The defences

9 The first defendant denied that the words complained of were understood to bear or were capable of bearing the meanings the plaintiffs asserted. It was also pleaded that the statements were made without its knowledge, approval and consent.

10 The second defendant’s defence was a bare denial of the words complained of and the meanings attributed to them.

11 Neither defendant pleaded justification, fair comment or qualified privilege in defence.

The issues

12 There were not many issues in this case, and at the close of the case, the issues that needed to be addressed were narrowed down to:

(a) whether the second defendant had said the words complained of;

(b) whether the words complained of bore the meaning the plaintiffs alleged;

(c) whether the plaintiffs’ action was sustainable without proof of special damage; and

(d) whether the first defendant was vicariously liable if the second defendant spoke the words complained of.

Whether the second defendant spoke the words

13 The plaintiffs did not have first-hand knowledge of those words themselves. The second plaintiff was informed of them by Liow Leong Eng (“Liow”), an employee of Amtek.[1] The plaintiffs sought to obtain more information from Amtek. Amtek was reluctant to be brought into the dispute and did not provide it voluntarily. Eventually, the plaintiffs obtained the information after pre-action interrogatories were served on three Amtek employees, namely Liow, Kok Chia Liang (“Kok”) and Ng Tong Chye (“Ng”).

14 Liow, Kok and Ng were principal witnesses for the plaintiffs in this action. Liow and Kok were the Technical Development and Research and Development managers respectively of Amtek whilst Ng was a senior engineer. They all related the events of 9 March 2004 where the second defendant and Elamurugan went to their company to demonstrate the V6 Software to the three of them and another Amtek employee, Xin Shou Jun, an engineer from China.

15 Their accounts set out in their affidavits of evidence-in-chief were largely similar. They recounted that the second defendant told them that he was aware that the second plaintiff was trying to sell his own metal stamping software to Amtek. The critical parts of the second defendant’s statements were set out by them in identical terms:

I have come to inform you that CT Wong has no any [sic] rights to develop software that is related to the Metal Stamping Industry.

and that:

[T]he software developed by CT Wong might have infringed the Intellectual Property Right of CAD-IT or V6’s technology software and will be subjected to further legal pursue [sic] and consequences.

and when Liow cautioned him that these were serious allegations and he was not concerned about the dispute between CT Wong and CAD-IT, the second defendant issued a warning that:

[A]ny future user or customer, including any prospective potential user/customer like Amtek, who uses the software developed by CT Wong will have to pay royalty fees to CAD-IT for the usage of CAD-IT or V6 technology.

16 The second defendant’s statements troubled Liow, Kok and Ng as they could affect their company, which was already a client of the first plaintiff. They had a discussion among themselves about two days later and submitted a report on the matter drafted by Liow to Amtek’s senior management. The text of the report was:

Re: Records of Incident for the Preview of V6 software of CAD-IT

1. On the 9th March, 2004 at about 2.30 pm, Mr. Alvin Tan, Market Development Manager and Mr. S.Elamurugan, Application Engineer of CAD-IT, came to our office on our invitation for V6 CAD software preview.

2. With Liow Leong Eng, Mike Kok, Ng Tong Chye and Xin Shou Jun attended the demonstration session in one of the meeting room at 3rd floor of No. 1 Kian Teck Drive, Singapore (628818).

3. Before the demonstration session started, Mr Alvin Tan made a claim that he has come here to inform us, that CT Wong has no rights to develop software that is related to the Metal Stamping Industry.

4. Mr. Alvin Tan also made a claim that he has come here to inform us that, the software developed by CT Wong might have infringed the Intellectual Property Right of CAD-IT/V6’s technology software, and will be subjected to future legal pursue and consequences.

5. Subsequently to statement 3 & 4, that accordingly to Mr. Alvin Tan, any future user/customer, including prospective potential user/customer like Amtek, who uses the software developed by CT Wong will have to pay the royalty fees to CAD-IT for the usage of CAD-IT/V6’s technology.

6. Upon watching the demonstration session, and testing on one of our assembly drawing (softcopy) created by the software developed by CT Wong, we found that V6 software was not able to read the data.

7. Mr. S.Elamurugan made a remark that it is a different data structure and hence V6 is not able to read it.

8. Mr. Alvin Tan said that he will announce the claim of statement 4 & 5 on the public launch of the V6 software on the 18th March 2004 at their seminar.

9. Mr. Alvin Tan verbally agrees to write to us on the claims of statement 4 & 5 after the public launch.

10. The demonstration session ends at about 3.30 pm.

11. We hereby state that the above statements are true within our personal capacity and best knowledge.

17 While both defence counsel questioned the three witnesses on this document, no questions were raised about its authenticity. Their evidence that the report was prepared and submitted to inform Amtek’s senior management of matters that happened on 9 March 2004 was not disputed.

18 Counsel cross-examined the three witnesses at some length and in some detail. They went through the events from the time of the arrival of the second defendant and Elamurugan, to their entry into the room where the demonstration was conducted, the persons who entered and left the room, the preliminary small talk, the presentation, the questions asked, and the discussions.

19 Not surprisingly, there were inconsistencies in the accounts of the three witnesses particularly on peripheral matters and matters of detail. But the main thrust of their evidence endured, that the words complained of were spoken in the course of that meeting. It was noteworthy that in cross-examination, it was not put to the witnesses that they had conspired to incriminate the second defendant, that they had reason to bear...